FGI Industries Ltd.

MANAGEMENT COMMENTARY

Dave Bruce, CEO of FGI, stated, “FGI reported total revenue of$30.5 million in the quarter, representing a year-over-year decrease of 14.4%. Gross profit was$8.1 million, a decrease of 6.8% compared to the prior year. The gross margin was 26.7%, an increase of 210 basis points compared to the fourth quarter of 2024 driven by the better relative performance of some of our higher margin businesses. Customers continued to evaluate the impact of tariffs on their businesses amid the Supreme Court decision in February and subsequent response by the administration. The industry outlook remains uncertain due to tariffs but FGI’s strategic investments in our Brands, Products and Channels strategy continues and is bearing fruit becoming a positive driver of revenue growth. FGI and our customers continue to evaluate a China+1 strategy to diversify and broaden our geographic sourcing. FGI’s fourth quarter revenue decreased 14.4% compared to the prior year period. Revenue declined 15.5%, 16.9%and 5.6% in the U.S., Canada and Europe markets. Sanitaryware, bath furniture and shower system revenue decreased 12.2%, 34.9% and 13.9% compared to the prior year period. Our Other segment revenue, including Covered Bridge, declined 9.0% compared to the prior year. Covered Bridge further expanded its geographies and increased its dealer count. Isla Porter, our digital custom kitchen joint venture, continues to establish relationships with the premium design community with on-trend products. In India, we added more dealers as we expand our presence there.” Bruce continued, “We are excited about our new product introductions and continue to invest in our brands and our future growth initiatives in our core businesses.

"The tariff environment in 2026 remains fluid. FGI navigated through the volatility of the tariffs in 2025 with full year revenue and gross profit each down less than 1% compared to the prior year. Despite the cautious order environment by our customers in the fourth quarter, we are seeing a pickup in activity as we begin 2026."

Jae Chung, Chief Financial Officer of FGI, commented, “Total revenue decreased 14.4% year-over-year in the fourth quarter. FGI continues to invest in long-term growth through our BPC strategy and discipline in overall operating expenses, which decreased 12.0% year-over-year to$8.8 million. FGI ended the fourth quarter with total available liquidity of$8.5 million. We believe the best use of our capital is for internal investment in order to

1 Adjusted operating loss and adjusted net loss are non-GAAP financial measures. Please refer to the paragraph titled “Non-GAAP Measures” for the definitions of non-GAAP financial measures and reconciliations to GAAP measures included in this press release.

attract new customers, expand existing relationships, develop new products and manufacturing capabilities and expand into new jurisdictions, and this will remain our priority in the near term.”